Sunday, July 05, 2009

The Money System is a Confidence Trick

by Arian Forrest Nevin, JD

Banks loan us money they create out of nothing. Not only is this a scam, but it is outlawed by the Constitution, although our government allows this criminal activity. This activity is at the heart of our unsound money system, which is the direct cause of our nation`s current economic collapse. To reverse our economic decline we must have a sound and constitutional money system.

"I thought that, as a scientific man, I ought to know something about economics. So I studied the money system for two years and could make nothing of it. Then, one day, the truth dawned on me. What I was studying was not a system, but a confidence trick." The conclusion that the money system is a confidence trick comes from "the father of nuclear fission" Nobel Prize winning chemist Frederick Soddy.

A confidence trick is a scam, a racket, a rip off, a con. What makes the money system a confidence trick? Put most simply, money is created for private profit by banks rather than created for the common good by the government. Only the government of a nation should create money. The confidence trick that is the money system takes two forms.

First, rather than simply print money, the government, when it wants more money than it has obtained through taxation, issues bonds. The Federal Reserve then creates new money that did not exist before and uses this money to purchase the bonds. Then the populace, through taxation, is forced to pay the interest on these bonds. This is how the National Debt was created. Rather than impoverishing the populace by forcing them to pay interest on bonds, the government could simply create money instead of having the Federal Reserve create money to purchase government issued bonds.

Second, banks devised a subtle way to counterfeit money. Banks invented a separate and distinct form of money other than cash. Banks invented a kind of money which exists solely as entries in their computers. Over 99% of money exists in this form. Anytime a check, credit card, debit card, or money order is used, electronic bank money is being used. Whenever someone gets a loan from a bank the bank is in fact creating entirely new electronic money that did not exist before. Through this subtle form of counterfeiting banks have been able to take control of the money system. This confidence trick is played not only by US banks but by all banks the world over. The money system is the world`s longest running and most successful confidence trick.

Not only is allowing banks to create money and charge us interest a confidence trick, but it is also illegal! The Constitution explicitly gives the power to create money to Congress and to Congress alone. It does not authorize Congress to allow private corporations to create money. Article I, Section 8, Part 5 of the Constitution of the United States gives Congress the power, "To coin money, regulate the value thereof, and of foreign coin". The Constitution is the highest law in the United States of America. No law passed by Congress can override the Constitution. It is illegal for banks to create money, and it is illegal for Congress to allow banks to create money. The only way banks could legally create money would be if an amendment to the Constitution authorizing money creation by banks were passed. There is no such amendment. Sadly the Constitution is not a self-enforcing document, and if the people do not force the government to follow its dictates the government is free to ignore the law without consequence.

President Garfield stated, "He who controls the money supply of a nation controls the nation". Is it any wonder that against the will of the great majority of Americans the banks and Wall Street were able to get the bailout bill passed? The so-called bailout was nothing other than a massive transfer of purchasing power from the people to the banks and the acquisition of worthless debt and stock by the government at high prices from the banks. Banks were able to force this bill through because of the enormous power they wield from controlling the money system. The Secretary of the Treasury, Henry Paulson, is a banker. He is the former CEO of Goldman Sachs, and he conducts government policy in accord with the interests of banks and not of the American people.

The truth of the monetary system has long been withheld from the American people. We have been kept in the dark by the twin commandments put into effect through the influence and power of banks: we shall not have an honest money system, and we shall not examine the money system except under their direction. An honest, constitutional money system is the one thing banks will not stand for. The workings of the money system and the economy are always discussed in mysterious terms. People feel that it is something too complicated for them to understand. In fact, only falsehoods and false principles need to be discussed in mysterious terms. Any person of average intelligence can understand how the money system works. However, banks do everything in their power to keep people from understanding how the money system works, because if the majority of Americans ever did understand, then there would soon be a great call for the abolition of the unsound and dishonest monetary system and a call for its replacement with an honest and constitutional one.

Never on television, radio, in newspapers, or in magazines is the truth of the money system discussed. The people are to be kept in the dark and ignorant. Only on the internet and in a few books is the truth of the monetary system discussed. Those who literally create money can certainly afford to direct the discourse regarding the money system in a direction favorable to their interests. Economists prophesize nothing but economic doom and gloom for us upon the horizon. This is true so long as we have a dishonest money system. As soon as it is replaced with an honest money system the way will be open to much greater prosperity than ever before.

The worldwide economic crisis we face today is caused directly by the dishonest and unsound money system. There can be no liberty without economic freedom. There can be no economic freedom without an honest money system. The people must demand an honest money system. We must put such pressure on the government that they have no alternative but to execute the will of the people. Either we continue to pay billions and trillions yearly to be kept artificially poor or we demand honest US constitutional money. The choice is clear.